Which of the Following Is True

question 65

Multiple Choice

Which of the following is true?

• A)PAIRS provides APRA with a score-card approach to assessing the risk of FI failure and the impact of any failure.
• B)PAIRS provides APRA with a single rating which incorporates both the probability that the FI will fail and the impact of any failure.
• C)PAIRS provides APRA with a rating that assesses the risk of FI failure.
• D)PAIRS provides APRA with an impact factor that determines what regulatory response needs to be implemented to prevent FI failure.

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Definitions:

Interest Rate

The percentage of a loan amount charged by the lender to the borrower for the use of assets, usually expressed as an annual percentage rate.

Net Capital Outflow

A contrast in the buying of foreign assets by residents of a country and the acquisition of its assets by non-residents.

NCO Curve

A hypothetical graphical representation that could relate to issues in international economics or capital flows, but requires clearer context for an accurate definition.

Capital Flight

The large-scale exodus of financial assets and capital from a nation due to economic or political instability.